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Uber in espionage, bribery and hacking allegations by former employee

The $1.86 billion legal battle between
ride-hailing giant Uber and Alphabet’s self-driving unit Waymo reached a
pivotal moment today as the judge in the case released a damning letter based
on the account of a former Uber employee.

The letter alleges that a special
division within Uber was responsible for acts of corporate espionage, the theft
of trade secrets, the bribery of foreign officials and various means of
unlawful surveillance.

The “Jacobs
letter” was written by the attorney for Richard Jacobs, who previously worked
as Uber’s manager of global intelligence before being fired in April. The
highly detailed account brings about accusations of systematic illegal activity
inside Uber’s Strategic Services Group (SSG) which allegedly sought to surface
other companies’ trade secrets through eavesdropping and data collection. The
letter alleges that some of the information gathered was relayed to then-CEO
Travis Kalanick.

In a statement,
an Uber spokesperson said, “While we haven’t substantiated all the claims in
this letter—and, importantly, any related to Waymo—our new leadership has made
clear that going forward we will compete honestly and fairly, on the strength
of our ideas and technology.”

The 37-page
letter details the actions of the SSG and the Marketplace Analytics (MA) group
which it claims “exists expressly for the purpose of acquiring trade secrets,
codebase, and competitive intelligence… from major ride-sharing competitors
globally.” The Jacobs letter also alleges that the group used ephemeral
encrypted chat apps and “non-attributable” devices to keep evidence of their
actions hidden.

The
heavily-redacted letter lays out the alleged processes with clear and unrelenting
detail.

While much
of the “hacking” or other forms of surveillance seemed to rely on these types
of automated systems, the company also allegedly engaged in physical
surveillance, including wiretaps, in order to discover competitors’ advantages
or weaknesses.

The company
“used undercover agents to collect intelligence against the taxi groups and
local political figures. The agents took rides in local taxis, loitered around
locations where taxi drivers congregated, and leveraged a local network of
contacts with connections to police and regulatory authorities,” the letter
alleges.

In a
November 29 email to employees regarding Jacobs’ accusations of human
surveillance, Uber GC Tony West wrote, “there is no place for such practices or
that kind of behavior at Uber. We don’t need to be following folks around in
order to gain some competitive advantage. We’re better than that. We will
compete and we will win because our technology is better, our ideas are better,
and our people are better. Period.”

These
allegations are sure to complicate Uber’s case in the already-messy trade
secrets theft case with Waymo.

In late
November, U.S. District Judge William Alsup postponed the trial just a day
before jury selection was set to begin after being informed of the existence of
the Jacobs letter. Uber’s legal team has referred to the letter as
“extortionist” in nature; the company paid a $4.5 million settlement to Jacobs
over his claims about the company’s operations. Judge Alsup disagreed with this
characterization, harshly criticizing the Uber legal team for not disclosing
the letter in the first place.

The trial
has been delayed until February 2018 to give the Waymo legal team more time to
investigate claims from Jacobs.

In a
statement, a Waymo spokesperson said, “Uber improperly withheld the Jacobs Letter,
which exposes the extreme lengths it was willing to go both to get a leg up on
competition and hide evidence of bad acts. Separate and apart from the letter,
Waymo has accumulated significant evidence that Uber is using stolen Waymo
trade secrets, including copying aspects of Waymo’s LiDAR designs down to the
micron, and we look forward to trial.”

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